Entrepreneurs and management

Sep 15, 1993

With more than 40,000 architecture, engineering and environmental consulting firms in the U.S., most of which have less than 20 people, no one is going to tell me that design professionals aren’t entrepreneurial. If they weren’t, the owners of these firms would all be working for the government or mega-corporations, instead of toiling away in their own relatively small companies, risking all that they own for the privilege. There are three common characteristics that I see in professional service entrepreneurs. First, they’re willing to take risks. Second, they know how to sell. Third— and this is true only for successful entrepreneurs they know how to manage. Let’s take a look at each of these characteristics. Taking risks: Entrepreneurs regularly get asked by friends and family members how they can stand the risk of being in business for themselves. The answer is that entrepreneurs don’t take any risks that they consider all that risky. They only take calculated risks with a high probability for success. Also, entrepreneurs tend to be confident, optimistic people who believe they can overcome just about any obstacle. Selling: Knowing how to sell is essential to the entrepreneur. You can have a great idea or concept for a new service, or you can find a new market for an existing service, but to get anywhere, you have to be able to sell it. Selling comes naturally to entrepreneurs. They are “high” on their businesses, because if they weren’t, they wouldn’t be in business in the first place. When you’re confident that what you provide is needed and valuable, it’s usually a fairly easy sell. Managing: Last is the ability to manage, something that only successful entrepreneurs have. Being a good manager isn’t a “sexy” idea. In fact, it has even been poo-pooed in the business press, which today seems to be stuck on “leadership.” In my experience dealing with A/E and environmental companies of every size, I have never to take management skills for granted. There are risk-takers and there are those who know how to sell, but not many good managers (and by “good”, I mean the men and women who consistently get the best from their people and meet or exceed the goals laid out for them). Fortunately, being a good manager is a skill that can be learned, if you’re willing to take the time. You’ve got to read, study and practice. Here are seven “rules of management” that one of our best clients, the president and CEO of a major national and international consulting firm, uses to guide his actions. (He agreed to give them to me as long as he could remain anonymous) Be a nice guy 97% of the time, but be a tough S.O.B. in the remaining 3%. People like to work for those that they feel treat them nicely and with respect. But human nature being what it is, there are those who will try to take advantage of your good nature. When they surface, confront them swiftly and powerfully. Give people more than they expect. That means more work, more responsibility, more authority, more individual discretion, more pay, and more feedback. When you do this, you find out what your people are really capable of doing, and you gain their loyalty. Don’t feel the need to always be consistent. Managers have to use different management tactics at different points in time. Sometimes, you may need to reward individual performance. At other times, the team’s effort may be more critical. Sometimes, singling out only one individual for reward or recognition may be detrimental. Good managers do what’s appropriate based on the situation at hand. Always worry about motivation and morale. Although it has never been proved conclusively, few would argue that motivation declines along with morale. A good manager will find and fix anything that hurts morale— especially in the professional service business, where a 5% productivity gain goes directly to the bottom line. One bad apple can spoil the whole bunch. If you have a negative thinker, or someone who is lousy team player, or someone who has to belittle others to make themselves look good, you better straighten that person out or get rid of them. See rule #4. If you want people to work long hours, set a good example yourself. Steve Foote, president of Perry, Dean, Rogers and Partners, Inc., an old-line Boston architectural firm, told me this story. Shortly after he’d joined the firm, a new project came in that had to be done in the week between Christmas and New Year’s. So on Christmas morning, after his kids had opened their presents, Steve drove to the office, arriving about 9:00 a.m., and sat down at his board to start the project. Just then, Robert Dean, at that time the firm’s president (and a retired 3-star general himself) came in, rolled up his sleeves, and said, “Tell me what you want me to do.” Don’t allow negative talk about clients to go on in the office. I have been in firms where the client is treated like the enemy. If that’s the case, why work for them? It’s true that there are clients who abuse their architects, engineers, and environmental consultants. No firm should put up with that kind of treatment. You don’t always know who these clients are at first, but when they do evidence themselves, don’t work with them anymore. But if the workers are critical of someone who’s been a good client, get them straightened out fast. Entrepreneurs will always be risk-takers who can sell. Successful entrepreneurs add good management to the recipe and get outstanding results. That’s what’s it all about. Originally published 9/15/93

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Zweig Group, three times on the Inc. 500/5000 list, is the industry leader and premiere authority in AEC firm management and marketing, the go-to source for data and research, and the leading provider of customized learning and training. Zweig Group exists to help AEC firms succeed in a complicated and challenging marketplace through services that include: Mergers & Acquisitions, Strategic Planning, Valuation, Executive Search, Board of Director Services, Ownership Transition, Marketing & Branding, and Business Development Training. The firm has offices in Dallas and Fayetteville, Arkansas.